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The Republican majority in Congress and the Trump administration have made repeal and replacement of the Affordable Care Act (ACA) a top priority. In May, the
House passed its replacement bill, the American Health Care Act (AHCA). In June, the
Senate released its own bill, the Better Care Reconciliation Act (BCRA). A revised version of the Senate measure was made public on July 13.

If the Senate passes the BCRA, then both the Senate and House bills could go to a joint committee to be reconciled, or House leaders could choose to hold a vote on the Senate measure.

Details on key differences between how employer obligations are treated under current law and in the House and Senate bills are provided below:

Affordable Care ActCurrent law.

American Health Care ActThe Republican House bill.

Better Care Reconciliation ActThe Republican Senate bill.

Individual Mandate:

Affordable Care ActAdults are required to maintain minimum essential coverage through an employer plan or an individual-market policy, or pay a tax penalty.

American Health Care ActTax penalty reduced to zero. A premium surcharge to be applied on insurance purchased on the individual market following a break in coverage of more than 63 days.

Better Care Reconciliation ActTax penalty reduced to zero. Consumers who had a break in coverage for 63 days or more would be subject to a six-month waiting period before their new coverage begins.

Employer Mandate:

Affordable Care ActEmployers with 50 or more full-time employees or equivalents are required to provide ACA-compliant health insurance to employees working 30 hours per week or more, or to pay a tax penalty.

American Health Care ActTax penalty reduced to zero.

Better Care Reconciliation ActTax penalty reduced to zero.

Annual Information Reporting:

Affordable Care ActEmployers that provide health coverage are required to annually report to the IRS the employees/dependents who received coverage, and the number of hours that employees worked (including for variable-hour employees).

American Health Care ActEmployers would report to the IRS the employees who received minimum essential coverage. Presumably, no duty to track employee hours.

Better Care Reconciliation ActEmployers would report to the IRS the employees who received minimum essential coverage. Presumably, no duty to track employee hours.

Cadillac Tax:

Affordable Care ActStarting in 2020, a 40-percent excise tax is imposed on the value of employer-sponsored health plans exceeding $10,200 for individual coverage and $27,500 for family coverage, indexed for inflation.

American Health Care ActCadillac tax delayed until 2026.

Better Care Reconciliation ActCadillac tax delayed until 2026.

Health Savings Accounts (HSAs) Contributions:

Affordable Care ActContributions limits for 2018 are $3,450 for self-only coverage and $6,900 for family coverage, plus a $1,000 catch-up contribution (age 55 or older).

Medicare Retiree Drug Subsidy:

Affordable Care ActAllows federal subsidy for offering prescription drug benefits to Medicare-eligible retirees to be excluded from a company’s income but denies a tax deduction for drug benefits provided to Medicare-eligible former employees.

American Health CareReinstates prior law that allowed both the exclusion of the subsidy from income and the deduction for costs funded by the subsidy.

Better Care Reconciliation ActReinstates prior law that allowed both the exclusion of the subsidy from income and the deduction for costs funded by the subsidy.

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